Tax Accounting.

I am looking for the correct answers for each of these 23questions with ANEXPLANATION FOR EACH ANSWER. If you think you can answer all of them Correctly, let me know. (Please see the attachment).

On January 1 of the current year, Robert and Ted from an equal partnership. Robert makes a noncash contribution of property with a fair market value of $70,000 and an adjusted basis of $80,000. Ted contributes noncash property with a fair market value of $70,000 and an adjusted basis of $50,000. Which of the following statements is Correct concerning the income tax results of this partnership formation?George and Helen do business as the GH Partnership, sharing profits and losses equally. George is a material participant in the partnership, and the partnership has no outstanding debt. All parties use the calendar year for tax purposes. On January 1 of the current year, George?s basis in the partnership was $30,000; he made no withdrawals from the partnership during the year. The partnership sustained an operating loss of $90,000 in the current year. George?s personal income tax return for the current year should include a deduction of:Verna is a 30% general partner in the calendar year, cash basis STV partnership. Her basis in the partnership interest at the beginning of the year is $2,000. The partnership received $125,000 income from services paid the following amounts:Fran receives a proportionate nonliquidating distribution when the basis of her partnership interest is $30,000. The distribution consists of $5,000 in cash and property with an adjusted basis to the partnership of $17,300 and a fair market value of $26,500. Fran?s basis in the noncash property received is. Jim is a partner in a continuing partnership. On December 31 of the current tax year, the partnership distributed to Jim cash of $9,000 and two land parcels in a proportionate current distribution. Land parcel A has an adjusted basis to the partnership of $10,000 and a fair market value of $12,000. Land parcel B had an adjusted basis to the partnership of $6,000 and a fair market value of $14,000. The basis of Jim?s partnership interest just prior to the distribution was $17,000. The basis of land parcel B to Jim is:Jack contributed cash to the Wren Partnership in 2004 in exchange for a 40% interest in the partnership. In the current year, he receives a distribution from the partnership of property with a basis to the partnership of $15,000 and a fair market value of $22,000. The basis in his partnership interest at the time of the distribution was $18,000. How much gain or loss does the Partnership recognize on the nonliquidating distribution?Carols has a basis in his partnership interest of $20,000. He receives a current distribution of $26,000 cash, unrealized receivables (FMV $11,000, basis of $10,000), inventory (FMV $8,000, basis $4,000), land held as an investment (FMV $7,000, basis $6,000), and building (FMV $20,000, basis $9,000). No depreciation recapture applies with respect to the building. The partners? relative interest in the Sec. 751 assets do not change as a result of the current distribution (Proportionate distribution). His basis in the building is:Ch11. Dan receives a liquidating distribution when the basis of his partnership interest is $37,000. The distribution consists of $10,000 in cash and real property with an adjusted basis to the partnership of $22,000 and a fair market value of $26,500. Dan?s basis in the land is:Ned received $10,000 cash and inventory (basis of $16,000 and fair market value of $26,000) in liquidating of his partnership interest. His basis in his partnership interest was $20,000 prior to the distribution. How much gain or loss does Ned recognize, and what is his basis in the inventory received in the distribution?Harry has a basis of $80,000 in the HAB Partnership as of December 31. On that date the partnership liquidates and distributes to Harry a pro rata distribution of $30,000 cash and inventory with a basis to the partnership of $40,000 and a fair market value of $45,000. How much gain or loss will Harry recognize on the distribution, and what basis will he take in the inventory?Sally and Ted are equal partners in the S & T Partnership. On January 1 of the current year, the Partnership had no debt, and each partner?s adjusted basis in S & T was $40,000. During the current year, S & T Partnership borrowed $6,000, for which Sally and Ted are personally liable. S & T sustained an operating loss of $100,000 for the current year ended December 31. How much loss is currently deductible by each partner?A and B are equal partners in the AB calendar year partnership. For the current year, the partnership had an operating loss of $80,000, a LTCL of $20,000 and a STCG of $10,000. The partnership had no other transactions for the current year. At the start of the current year, A?s basis in his partnership interest was $15,000. How much ordinary loss will A recognize on her tax return?Andy owns a 30% interest in the AB Partnership. Andy acquired his interest by contributing land held as an investment with a FMV of $7,000 and adjusted basis of $20,000. AB sold the land, held as inventory, 3 years later for $12,000. Assuming no other transaction during the year, Andy?s allocable share is:In return for a 10% partnership interest, Mary contributes to the XY Partnership a machine having a $70,000 FMV and an adjusted basis of $20,000. The partnership assumes Mary?s $30,000 liability arising from her purchase of the machine and Mary has a 10% share of partnership liabilities. The XY Partnership has no liabilities immediately preceding her contribution.INFORMATION FOR QUESTIONS 16 AND 17.On 1/1 of the current year, B?s basis in her partnership interest was $10,000.

There are no partnership liabilities at the beginning of the year. Partnership liabilities at year end are $2,000.

During the year, B received a noncash distribution of property with a FMV of $14,000 and adjusted basis to the Partnership of $12,000.B?s current deduction of ordinary loss is ?B?s basis in the Partnership Interest on 1/1 of the following year is ?

INFORMATION FOR QUESTIONS 18-22.

On January 1, Tom, Dick, and Harry form a partnership. The contributions of the three individuals are listed below. Tom and Harry each received a 20% partnership interest while Dick received a 60% partnership interest. They share the economic risk of loss from recourse liabilities according to their partnership interests.

Individual Asset Basis to Partner FMV

Tom Accounts rec. $--0-- $20,000

Dick Land 45,000 60,000

Building 30,000 60,000

Harry Services ? 20,000

Dick has claimed $60,000 of straight-line MACRS depreciation on the building. The building has a $60,000 mortgage which is assumed by the partnership. Harry is an attorney and the services he contributes are the drawing-up of all partnership agreements.

• What is the amount and character of the gain, loss, or income recognized by Harry on the formation of the partnership and what is his basis in the partnership interest?

• What is Dick?s basis in his partnership interest at the time of formation?

• What is Tom?s basis in his partnership interest at the time of formation?

• If the partnership sells the land contributed by Dick for $75,000, what is Dick?s allocable share of the gain?

What is a family partnership? Under what circumstances can a family member be a partner in such a partnership? What income allocation is required?

TAX ACCOUNTING 1. On January 1 of the current year, Robert and Ted from an equal partnership. Robert makes a noncash contribution of property with a fair market value of $70,000 and an adjusted basis of $80,000. Ted contributes noncash property with a fair market value of $70,000 and an adjusted basis of $50,000. Which of the following statements is Correct concerning the income tax results of this partnership formation? 2. George and Helen do business as the GH Partnership, sharing profits and losses equally. George is a material participant in the partnership, and the partnership has no outstanding debt. All parties use the calendar year for tax purposes. On January 1 of the current year, George's basis in the partnership was $30,000; he made no withdrawals from the partnership during the year. The partnership sustained an operating loss of $90,000 in the current year. George's personal income tax return for the current year should include a deduction of: 3. Verna is a 30% general partner in the calendar year, cash basis STV partnership. Her basis in the partnership interest at the beginning of the year is $2,000. The partnership received $125,000 income from services paid the following amounts: Rent Expense $17,000 Salary expense to employees 40,000 Payment to Verna for services, per the partnership agreement 16,000 (Guaranteed payment) Distributions to Verna 18,000 By how much will Verna's adjusted gross income be increased as a result of the above items? 4. Fran receives a proportionate nonliquidating distribution when the basis of her partnership interest is $30,000. The distribution consists of $5,000 in cash and property with an adjusted basis to the partnership of $17,300 and a fair market value of $26,500. Fran's basis in the noncash property received is. 5. Jim is a partner in a continuing partnership. On December 31 of the current tax year, the partnership distributed to Jim cash of $9,000 and two land parcels in a proportionate current distribution. Land parcel A has an adjusted basis to the partnership of $10,000 and a fair market value of $12,000. Land parcel B had an adjusted basis to the partnership of $6,000 and a fair market value of $14,000. The basis of Jim's partnership interest just prior to the distribution was $17,000. The basis of land parcel B to Jim is: 6. Jack contributed cash to the Wren Partnership in 2004 in exchange for a 40% interest in the partnership. In the current year, he receives a distribution from the partnership of property with a basis to the partnership of $15,000 and a fair market value of $22,000. The basis in his partnership interest at the time of the distribution was $18,000. How much gain or loss does the Partnership recognize on the nonliquidating distribution? 7. Carols has a basis in his partnership interest of $20,000. He receives a current distribution of $26,000 cash, unrealized receivables (FMV $11,000, basis of $10,000), TAX ACCOUNTING inventory (FMV $8,000, basis $4,000), land held as an investment (FMV $7,000, basis $6,000), and building (FMV $20,000, basis $9,000). No depreciation recapture applies with respect to the building. The partners' relative interest in the Sec. 751 assets do not change as a result of the current distribution (Proportionate distribution). His basis in the building is: 8. Ch11. Dan receives a liquidating distribution when the basis of his partnership interest is $37,000. The distribution consists of $10,000 in cash and real property with an adjusted basis to the partnership of $22,000 and a fair market value of $26,500. Dan's basis in the land is: 9. Ned received $10,000 cash and inventory (basis of $16,000 and fair market value of $26,000) in liquidating of his partnership interest. His basis in his partnership interest was $20,000 prior to the distribution. How much gain or loss does Ned recognize, and what is his basis in the inventory received in the distribution? 10. Harry has a basis of $80,000 in the HAB Partnership as of December 31. On that date the partnership liquidates and distributes to Harry a pro rata distribution of $30,000 cash and inventory with a basis to the partnership of $40,000 and a fair market value of $45,000. How much gain or loss will Harry recognize on the distribution, and what basis will he take in the inventory? 11. Sally and Ted are equal partners in the S & T Partnership. On January 1 of the current year, the Partnership had no debt, and each partner's adjusted basis in S & T was $40,000. During the current year, S & T Partnership borrowed $6,000, for which Sally and Ted are personally liable. S & T sustained an operating loss of $100,000 for the current year ended December 31. How much loss is currently deductible by each partner? 12. A and B are equal partners in the AB calendar year partnership. For the current year, the partnership had an operating loss of $80,000, a LTCL of $20,000 and a STCG of $10,000. The partnership had no other transactions for the current year. At the start of the current year, A's basis in his partnership interest was $15,000. How much ordinary loss will A recognize on her tax return? 13. Andy owns a 30% interest in the AB Partnership. Andy acquired his interest by contributing land held as an investment with a FMV of $7,000 and adjusted basis of $20,000. AB sold the land, held as inventory, 3 years later for $12,000. Assuming no other transaction during the year, Andy's allocable share is: 14. In return for a 10% partnership interest, Mary contributes to the XY Partnership a machine having a $70,000 FMV and an adjusted basis of $20,000. The partnership assumes Mary's $30,000 liability arising from her purchase of the machine and Mary has a 10% share of partnership liabilities. The XY Partnership has no liabilities immediately preceding her contribution. TAX ACCOUNTING 15. INFORMATION FOR QUESTIONS 16 AND 17. On 1/1 of the current year, Ted's basis in his partnership interest was $11,000. His allocable share of ordinary income (loss) for the year was ($9,000), and his share of LTCG was $200. During the year Ted received a distribution of $10,000. How will Ted treat the above? A and B are equal partners in the calendar year AB Partnership. For the current year, the partnership had the following: Ordinary income (loss) ($20,000) Long-term capital gain 6,000 Interest income 4,000 - On 1/1 of the current year, B's basis in her partnership interest was $10,000. There are no partnership liabilities at the beginning of the year. Partnership liabilities at year end are $2,000. During the year, B received a noncash distribution of property with a FMV of $14,000 and adjusted basis to the Partnership of $12,000. 16. B's current deduction of ordinary loss is ? 17. B's basis in the Partnership Interest on 1/1 of the following year is ? INFORMATION FOR QUESTIONS 18-22. On January 1, Tom, Dick, and Harry form a partnership. The contributions of the three individuals are listed below. Tom and Harry each received a 20% partnership interest while Dick received a 60% partnership interest. They share the economic risk of loss from recourse liabilities according to their partnership interests. Individual Asset Basis to Partner FMV TAX ACCOUNTING Tom Accounts rec. $--0-- $20,000 Dick Land 45,000 60,000 Building 30,000 60,000 Services ? 20,000 Harry Dick has claimed $60,000 of straight-line MACRS depreciation on the building. The building has a $60,000 mortgage which is assumed by the partnership. Harry is an attorney and the services he contributes are the drawing-up of all partnership agreements. 18. What is the amount and character of the gain, loss, or income recognized by Harry on the formation of the partnership and what is his basis in the partnership interest? 19. What is Dick's basis in his partnership interest at the time of formation? 20. What is Tom's basis in his partnership interest at the time of formation? 21. If the partnership sells the land contributed by Dick for $75,000, what is Dick's allocable share of the gain? 22. What is a family partnership? Under what circumstances can a family member be a partner in such a partnership? What income allocation is required